The Gambler's Fallacy

Briefly what this says is "The gambler's fallacy is a logical fallacy involving the mistaken belief that past events will affect future events when dealing with random activities..." etc.

The idea is that the dice or roulette wheel does not have a memory. So if red came up 10 times in a row on the roulette table then the chance of it coming up red the next time is not affected by the previous results.

quote:Originally posted by inventor
I'm in California and I start at 5.30 and when I’m in Greece I start at 3.30 in the afternoon.

I understand now.

quote:I have a simulator From Rosenthal Collins Group was my broker, and this is the funny part no meter what kind of trouble I get in to with the simulator I can always get out with a profit or brake even.

It looks like your posting got cut short. You are saying that in the simulator you take a long position for example. If the position moves against you then you keep on adding to it to bring down the average entry price. So far you have always gotten out of your position on the simulator with a profit. If I understand you correctly, you would not do this in real trading so this is not a very good way to use the simulator, is it not?

It looks like your posting got cut short. You are saying that in the simulator you take a long position for example. If the position moves against you then you keep on adding to it to bring down the average entry price. So far you have always gotten out of your position on the simulator with a profit. If I understand you correctly, you would not do this in real trading so this is not a very good way to use the simulator, is it not?

Let’s see if I can explain the simulator /real money scenario, it is mostly psychological for me and I haven’t been able to implement or transfer the system to daily real money trading yet! it should be ease for me been a behaviorist? That means I know my behavior BUT? So this is the play; all my indicators are pointing on a long uptrend with valium to support it, so I buy in, 3 ticks later it reverses, now keep in mined the 1.75 point rule if is violated I add in every 1 point move till it stops and reverses in my favor, when it gets to brake even either I get out or if the move is strong and holds for an extra point or two I hold the position for that. Now this is happening in a one minute time frame. So! fast decision is in order, the reason I get out of trouble in the simulator is because is not my money, with real money the decision is based on saving the capital to play another day where in fact my system is 85% to 90% successful. Hence my psychological dilemma.

UrbanSound, you and I are saying the same thing. Simply using price bars you cannot predict the next bar. The predictability of future bars is in the patterns. Such patterns include S/R, Fibs and such. It is the formation that gives predictive value because from that you are able to see what other traders are thinking and hoping for.